Spanning hundreds of miles along the Atlantic Ocean and the Gulf of Mexico, Florida’s world-famous beaches draw over 140 million tourists annually and entice many to relocate to the Sunshine State. Florida’s sunny climate, myriad activities, and lack of state tax make it a highly attractive place to live. However, Yawar Charlie, a senior real estate agent, director of Aaron Kirman Group’s estates division, and a cast member of CNBC’s “Listing Impossible,” advises caution when investing in Florida real estate. “Not every sunny spot in the Sunshine State is a wise investment,” he says.
Consider Economic and Environmental Factors
“Investing in real estate goes beyond sunshine and palm trees,” Charlie emphasizes. “You need to assess economic stability, growth potential, and environmental risks.” He urges prospective buyers to weigh the financial forecasts carefully before getting swept up by Florida’s warm weather appeal. Being well-informed and strategic can help identify true market opportunities.
Despite being based in Los Angeles, Charlie’s significant client base in both California and Florida keeps him attuned to the dynamics of both markets. He highlights five Florida cities to avoid for property investment over the next five years.
Miami Beach
Famed for its pristine beaches, vibrant nightlife, and world-class dining, Miami Beach may be an exciting vacation or Spring Break destination, but Charlie advises against purchasing property here. “Rising sea levels and frequent hurricanes pose substantial risks,” he explains. “The cost of insuring properties is skyrocketing, and the potential for long-term value depreciation is significant. It’s like buying a beachfront home with a ticking time bomb.”
Daytona Beach
Daytona Beach, with its 23 miles of white-sand beaches ideal for surfing, swimming, windsurfing, and kayaking, might seem enticing, especially given its affordability. However, Charlie warns against investment. “Despite its famous speedway, Daytona Beach suffers from economic stagnation and high crime rates,” he notes. According to Neighborhood Scout, one in 28 people are likely to become a victim of a violent or property crime. “The sluggish real estate market and lack of major economic development suggest property values will remain flat,” Charlie adds. “Investing here might feel like being stuck in a pit stop.”
Fort Myers
Fort Myers, another picturesque beach locale, also comes with warnings. “Despite its appeal to retirees, Fort Myers faces overdevelopment and environmental concerns, particularly regarding water quality,” Charlie says. “The housing market is volatile, and long-term growth prospects are uncertain. Investing here is like buying a flashy car that might run out of gas.”
Pensacola
With its turquoise waters and sparkling white sandy beaches, Pensacola might seem like the ultimate escape. Yet, Charlie advises caution. “This city has faced economic challenges and limited job growth, impacting the housing market,” he explains. “High crime rates and a lack of new development projects make it less appealing to investors.” Neighborhood Scout reports that Pensacola’s crime rate is 86% higher than other cities in the state, with one in 33 people likely to become a victim of violent or property crime. “Investing here could feel like trying to catch a wave in a kiddie pool,” Charlie warns.
Ocala
Ocala, known for its pretty, clean, and budget-friendly environment, also has its drawbacks. “Ocala has one of the highest crime rates in America, compared to all communities of all sizes,” according to Neighborhood Scout. “While affordable, Ocala’s real estate market is hindered by slow economic growth and limited amenities,” Charlie says. “The area’s heavy reliance on agriculture can be volatile. It’s a quiet town, but that tranquility might come at the cost of your investment’s growth. Investing here is like putting your money into a time capsule with no guarantee of future rewards.”
